3.22.15  Foreign Partnership Withholding (Cont. 1)

3.22.15.13 
Special Returns

3.22.15.13.3 
Delinquent Returns

3.22.15.13.3.3  (01-01-2015)
♦Collection Secured♦

  1. These returns are identified by the notations: "TC 59X" or "ICS" .

    1. Do Not enter CCC "G" on these returns.

    2. Correspond for conditions that cannot be processed (e.g., missing signatures, missing schedules, etc.).

    3. Enter CCC "W" if the Received Date is more than 2 years and 9 months after the Return Due Date. Do Not send the return to Statute Control.

3.22.15.13.3.4  (01-01-2015)
♦Examination Prepared♦

  1. These returns are identified by the notation: "SFR" or "SUBSTITUTE FOR RETURN" on Page 1.

    1. Return must have a Received Date. If no Received Date is present, follow the normal procedures for editing the Received Date.

    2. Do Not correspond with the taxpayer for unprocessable conditions. If the return is completely unprocessable, use No Reply procedures and enter CCC "3" and continue processing.

    3. If Form 13133 is attached, enter the Computer Condition Codes that are checked on the form.

      Note:

      CCC "R" should not be used with a CCC "4" .

    4. Enter CCC "W" if the Received Date is more than 2 years and 9 months after the Return Due Date. Do Not send the return to Statute Control.

3.22.15.13.3.5  (01-01-2015)
♦Examination Secured♦

  1. These returns are identified by the notation: "Process as Original" on Page 1 of the return and a Form 13133, Expedite Processing Cycle, attached with the "Delinquent Return" box checked.

    1. Correspond for conditions that cannot be processed (e.g., missing signatures, missing schedules, etc.).

    2. Enter the Computer Condition Codes that are checked on Form 13133.

      Note:

      CCC "X" (Hold Credits on Module) is not valid for Form 8804.

    3. Enter CCC "W" if the received date is more than 2 years 9 months after the Return Due Date. Do Not send to Statute Control function.

3.22.15.13.3.6  (01-01-2015)
♦Frivolous Argument♦

  1. A frivolous argument is used for the purpose of expressing dissatisfaction with the substance, form or administration of the tax laws by attempting to illegally avoid or reduce tax liabilities. Recognized frivolous arguments made by businesses include, but are not limited to, the examples in IRM 4.10.12.1.1, Frivolous Arguments

  2. Review the return to determine whether it appears to be a frivolous return. See Exhibit 3.22.15-10.

    If... Then...
    The return meets any of the conditions identified as a frivolous return.

    Caution:

    If the return shows Action Code "331" and has a Form 4227 attached with the remarks, "Refer to Exam FRP for audit after processing," continue to next procedure.

    Remove return from the batch and place the return in the locally designated basket for Examination, Frivolous Return Processing (FRP) for review.

    Note:

    IRM 4.10.12.1.3.3, Campus FRP Coordinators, requires Examination to expedite the return and make a determination whether it qualifies as a frivolous return within two (2) business days.


    If a determination is not made within the allowed timeframe, the Examination examiner will edit Action Code "331" in the lower left margin of the Form.
    Examination has selected the return as frivolous,

    Example:

    Indicated by an Action Code "331" , and a Form 4227 with the remarks, "Refer to Exam FRP for audit after processing," but sends the return for processing,

    Continue processing the return using procedures in IRM. However, do not circle or void the Action Code indicating a frivolous return.

    Note:

    Returns having only zeros, no entries, are blank or indicate "None," "Not Liable," etc... with no evidence of a frivolous argument are not to be considered as frivolous returns.

3.22.15.13.4  (01-01-2015)
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3.22.15.13.5  (01-01-2015)
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3.22.15.14  (01-01-2015)
Re-Entry Document Procedures

  1. A return posted to the wrong account or module, or, attempting to post, must be reprocessed to post to the proper account or module. A Re-entry document is referred to as:

    • A Re-input return (a return that has not posted to the master file, e.g., unpostable).

    • A Re-processable return (a return that has posted to the master file, e.g., return posted to the wrong account or module).

  2. Each re-entry return must have Form 3893, Re-Entry Document Control, or Form 13596, Reprocessing Returns attached.

    • Form 3893 is used to reinput documents

    • Form 13596 is used to reprocess documents.

  3. Always leave Form 3893 or Form 13596 on the front of the return. It must remain as a permanent part of the document.

    Exception:

    If the return is more than 2 years and 6 months from the return due date, do not use Form 3893 or Form 13596 reprocessing procedures. Route return to the Statute Control Unit following statute procedures.

  4. Examine Form 3893 and/or Form 13596 to determine the action needed to make the return processable.

    If... Then...
    Form 3893 or Form 13596 is missing
    1. Enter CCC "U" in error register Field 01-L.

3.22.15.15  (01-01-2015)
Validity Errors

  1. The three general types of errors that will cause a record to print on the Error Register are:

    • Field Validity Errors

    • Section Validity Errors

    • Math/Consistency Errors

3.22.15.15.1  (01-01-2015)
Field Validity Errors

  1. These errors result when required data is missing, or when incorrect data is present.

  2. These errors are indicated by an asterisk (*) printed before the invalid field.

  3. An asterisk may also be printed before a field for verification purposes.

    Note:

    This is also known as "look-see" condition, when the computer wants you to "look and see" if data should be entered into a particular field, or verify that the data in the field should be there, and if so, if it is correct. If everything is correct and there is no other error, use Action Code "7" to clear the record. If there is another error, no special action is required for this "look-see" condition.

  4. Correction procedures:

    1. Compare the return entry with the Error Register field.

    2. Enter Action Code "6" .

    3. Line out the incorrect field.

    4. Enter the correct data immediately above the lined-out data.

3.22.15.15.2  (01-01-2015)
Section Validity Errors

  1. These errors include:

    • Missing data (missing section)

    • Extraneous data

    • Integrated Submission and Remittance Processing (ISRP) errors

    • Terminus errors

3.22.15.15.2.1  (01-01-2015)
Correcting Section Validity Errors

  1. Compare the section(s) entry with the Error Register fields.

  2. Line out each incorrect field and enter the correct data immediately above the lined-out data.

  3. Enter Action Code "6" .

  4. If no error is found, use Action Code "7" to clear the Error Register.

    Note:

    Before using Action Code "7" be sure to first look at the specific correction information under the particular error condition.

  5. For Terminus Errors, if a return entry is truly larger than the maximum size field acceptable for computer processing,

    1. Reject the return record with Action Code "3" .

    2. Attach Form 4227 with an explanation.

3.22.15.15.2.2  (01-01-2015)
Missing Section Errors

  1. The computer will generate a section with all fields "blank" and an asterisk will appear to the left of the Section Number.

  2. If there is Data to be entered into a field, enter it (changing the field breaker, only if required). If there is no data and no other error appears on the record, use Action Code "7" .

    Note:

    Be sure no field in the section requires data before clearing the record, or the record will Loop. Read the section data in the IRM to determine what is required.

3.22.15.15.2.3  (01-01-2015)
Extraneous Section Errors

  1. Extraneous section errors are caused by the transcription of an unnecessary section.

  2. These errors are indicated by one pound sign (#) preceding the section number.

  3. Delete the Extraneous section with Action Code "4" . Be sure the extraneous section was not entered in place of another section that is missing and required for the record. Examine the Register.

3.22.15.15.2.4  (01-01-2015)
ISRP Errors

  1. ISRP errors are caused when too many characters have been entered for a field.

  2. Extra characters are dropped when the data is converted to Error Register format.

  3. These errors are printed to the left of the Section Number and will be shown on the Error Register as described in (4), (5), (6) and (7) below:

  4. "#1" : Split screen transmission.

    1. The Key Verifier attempted to change Check Digit

    2. The Key Verifier changed four or more digits of TIN

    3. The Original Entry operator entered required Section as "missing"

  5. "#3" : Invalid Section ending point.

  6. "#4" : Invalid field length.

  7. "#5" : Questionable section. A section was entered twice or entered out of sequence by ISRP.

  8. Examine each field in the section with the error notation. If there is no error, use Action Code "7" to clear the record.

3.22.15.15.2.5  (01-01-2015)
Terminus Errors

  1. Terminus errors are caused when a non-numeric character is entered in a numeric field or when the format of a section is incorrect.

  2. These errors are identified by two asterisks (**) printed to the left of the section number.

  3. If you enter or correct data in a field in the Terminus section with Action Code "6" , or delete the section with Action Code "4" , because it is not needed and it re-appears on Loop with the "**" still before the section number, it will be necessary to re-input the document using Form 3893, and a "2-R" on the rejects register. SCRS will have to reject such a record.

    Note:

    Action Code "7" will not clear the Terminus condition, even if there is no error on the Loop register.

3.22.15.15.3  (01-01-2015)
Math/Consistency Errors

  1. Math/consistency errors are caused when the computer computation differs from the taxpayers computation or the transcribed amount.

  2. Math Errors occur when:

    1. There is a transcription error

    2. The taxpayer reports more entries than can be transcribed

    3. The taxpayer makes a mistake in a calculation

  3. When a Math Error occurs,

    1. The computed amount in question will underprint with the computer's calculation

    2. The "Manual Correction" field is Field 03-A.

  4. Use the "Manual Correction" field to bypass the math check on a loop. Use Action Code "0 " .

  5. If the transcription is correct, use Action Code "6" to enter the computer's calculation in the "manual correction" field.

  6. If the computer cannot compute the amount correctly. Then:

    1. Verify the taxpayer's computation.

    2. Enter Action Code "6" to enter the verified total into the "Manual Correction" Field 03-A.

  7. To correct math/consistency errors:

    1. Compare the transcribed amount listed above the underprinted figure on the Register to the Form 8804 to ensure the information was accurately transcribed.

    2. If the transcription is correct, and the error is within tolerance, bring up the underprinted amount into the Manual Correction field. Use Action Code "0" .

    3. If the transcription is correct, and the error is not within tolerance, use Action Code "6" to enter the correct amount in the "Manual Correction" field.

    4. Always leave a working trail to ensure that any correction made on the Error Register is also made to the return itself.

3.22.15.16  (01-01-2015)
Error Correction

  1. Error Register fields are identified by a letter designation in the left most position of the field.

  2. The designators are listed in the appropriate section in this IRM.

  3. On the Error Register, an asterisk "*" designates an invalid field.

    Note:

    Any field may be corrected even if not designated invalid.

  4. When making corrections to the Error Register, the correction must also be made to the corresponding area on the return.

  5. When an invalid or math error condition is indicated, determine whether correction of the transcription errors resolve the situation.

3.22.15.17  (01-01-2015)
Correcting Invalid Correction Attempts

  1. An invalid correction attempt error is caused by:

    • An incorrect entry on the Error Register

    • A ISRP error when transcribing data from the Error Register

  2. A complete description of invalid attempts may be found in IRM 3.12.38, BMF General Instructions for Campus Error Resolution.

  3. When an invalid correction attempt is detected, "AA" is printed to the right of the Batch Number on the Document Identification Line of the Loop Error Register.

    Note:

    If the document is unprocessable, use Action Code "3" to send it to Rejects.

  4. If the cause of the invalid correction attempt can be determined, correct the loop Register as if no attempt had been made to correct it before.

    Note:

    It may be necessary to examine the correction made on the prior Error Register.

  5. If the cause of the invalid correction attempt cannot be determined, enter Action Code "7" .

    Note:

    Not every invalid correction attempt that causes the "AA" to appear on the register results in an error that requires correction. Many such invalid correction attempts do not appear on the register at all. Transcription enters more data into the computer that appears on the error register, and it is this other data that is causing the "AA" to appear.

3.22.15.18  (01-01-2015)
Unprocessable Returns

  1. When perfection of a return is not possible, reject the return.

  2. Review for unprocessable conditions.

3.22.15.18.1  (01-01-2015)
Illegible or Missing Data

  1. To correct illegible or missing data use the following procedures:

    IF... THEN...
    the error condition involves an Illegible or Missing Name and/or Address, and the required data cannot be perfected through research of the document,
    1. Enter Action Code "3" .

    2. Re-charge the return out of the block.

    3. Prepare Form 4227, attach it to the return, and

    4. Route it to the Rejects unit.

  2. Rejects inputs a Notice of Action on the Master File as discussed below by using IDRS Command Code REQ77/FRM77.

    • When an unprocessable return is rejected and sufficient information is available: enter Transaction Code (TC) 599 and enter Closing Code "17" to defer the normal delinquency check.

    • When the EIN, Name Control, MFT, and Tax Period are present; enter TC 599 and enter Closing Code "17"

3.22.15.19  (01-01-2015)
Processing Form 8804 - Error Register and General Information

  1. Form 8804 appears on the Error Register (not the ERS terminals) and there is no electronic filing.

  2. The Form 8804 Error Register can contain up to three sections: 01, 02, and 03.

  3. These returns are processed at the Ogden Submission Processing Campus.

  4. All editing is completed on the return.

  5. The Extension request form is Form 7004. Prior to 01/01/2006, the extension request used was Form 2758 (Application for Extension of Time to File Certain Excise, Income, Information, and Other Returns becoming Historical effective 09/21/2006).

  6. The Document Locator Number (DLN) for Form 8804 is as follows.

    • The "File Location Code (FLC) must be 98 (if PSPC) or 60 (if OSPC)"

      Note:

      Do not renumber to "66 or 78" if a U.S. Possession address, or "28 or 29" if a domestic address on Form 8804.

    • The Tax Class "1"

    • The Document Code "29"

    • The Blocking Series "000-999"

    • The MFT Code "08"

    • The Program Code "11340"

  7. The earliest valid tax period is 200412. Prior to 200412, the return is processed through Non Master File. The valid months are 01-12.

3.22.15.20  (01-01-2015)
Section 01: Form 8804

  1. Section 01 alpha field designators, maximum field lengths, titles and return locations are as follows:

    Field Reference Field Length Field Title Field Location on Form 8804 Return
    01-A 12 Remittance Amount Remittance amount is documented in the margin to the right of Line 10, Page 2

    Note:

    Green Rocker

    01-B 6 Tax Period Appears to the left of the printed tax year
      2 Tax Period Underprint  
    01-C 4 Name Control Line 1a
      4 Name Control Underprint  
    01-D 9 TIN Line 1b
    01-E 1 Books and Records CKBX Appears to the right of CKBX above Line 1b
    01-F 35 In Care of Name Line Line 1c
    01-G 35 Foreign Address Line 1c
    01-H 35 Address Line 1c
    01-I 22 City or Town Line 1d
    01-J 2 State or Province Line 1d
    01-K 12 Zip Code or Foreign Postal Code Line 1d
    01-L 10 CCC Inside "For IRS Use Only" box - CC line
    01-M 8 Received Date Inside "For IRS Use Only" box - RD line
    01-O 8 Correspondence Received Date Inside "For IRS Use Only" box - CR line
    01-P 1 Entity Underprint Code  
    01-Q 6 TPNC Appears at the upper TOP left of Form 8804
    01-R 9 Preparer's PTIN (Preparer Tax Identification Number) On page 2 Signature area, PTIN box
    01-S 9 Preparer's EIN On page 2 Signature area, Firm’s EIN box
    01-T 10 Preparer's Phone Number On page 2 Signature area, Phone NO. box
    01-U 7 Foreign Partner Count Line 3a
    01-V 7 Form 8805 attached to Form 8804 Line 3b
    01-W 7 Form 8804-C attached to Form 8805 Line 3c

3.22.15.20.1  (01-01-2015)
Field 01-A - Remittance Amount

  1. Field 01-A is a 12 position money field that may be present.

  2. The valid characters are numeric 0-9, or blank.

  3. It is entered into the margin to the right of Line 10, Page 2.

  4. It is entered in dollars and cents, and must be positive.

  5. The field shows the amount of remittance paid with the return that is not already in the module.

  6. This is a fixed field which cannot be corrected with Action Code "6" . If there is an error, reject using AC "3" . Rejects will re-input the return with the correct amount of remittance on the Form 3893 (in the "credit" box).

  7. The field is invalid if the total tax amount is not present in Field 02-P, or if the total tax field underprints "zero."

    Note:

    Entering the correct total tax amount into Field 02-P eliminates the invalid condition. If there is no tax and the remittance is for penalty or interest only, enter a "1" into Field 02-P.

3.22.15.20.2  (01-01-2015)
Field 01-B - Tax Period

  1. Field 01-B is a 6 position field that must be present. The tax period is on the preprinted label or edited in the upper right corner of the return, and to the left of the pre-printed year in YYYYMM format.

    Exception:

    Do not enter the Tax Period on current calendar year returns because the computer Auto-generates the tax period.

  2. Valid characters are numeric 0-9.

  3. Field 01-B is invalid if any of the following is present:

    • Field 01-B is blank

    • The month is not in the range of 01-12

    • The tax period is for a future period (later than the register date)

    • The tax period is a month or less in the future

    • The tax period is prior to 200412

  4. Form 8804 may be filed for either a calendar or fiscal year.

    Caution:

    Do not send any Form 8804 to Statute Control.

  5. The field underprints if the month in the tax period disagrees with the month in the module.

    If... Then...
    The tax period is prior to 200412,
    1. Reject the return (and any Form 8805 attached to the return) and transship to the CSPC for re-numbering to Non-Master File (NMF).

    2. Prepare Form 4227 with the notation PRE 200412 Form 8804 RETURN - PROCESS VIA NMF.

    3. Forward return to CSPC Accounting Branch for processing:
      Internal Revenue Service
      Cincinnati, Ohio 45999–0005

    Caution:

    If the tax year on Form 8804 begins with January 2004, or later, and ends before December 31, 2004, (200412) because it is a final return, then change the tax period to 200412. Be sure CCC "F" is present in Field 01-L. Do not send Form 8804 to be re-numbered for NMF processing.

    The tax period is not entered correctly
    1. Line through the error on the register.

    2. Enter the correct tax period.

    3. Enter Action Code "6" to the left of Section 01.

    4. Enter "2" in Field 01-P.

    The tax period on the register agrees with the return
    1. Research INOLE and ENMOD for the correct Fiscal Year Month (FYM).

    2. Correspond with the taxpayer for the correct FYM period using Letter 3653C (Foreign Trust Return Processing).

    3. If a new TIN account, forward the return to Entity Control Unit for input of a TC 016.

    4. Enter the corrected tax period in Field 01-B.

    5. Enter "2" in Field 01-P.

    The tax period ends on one of the first three days of a month
    1. Enter the tax period and using the previous month in Field 01-B.

      Example:

      If the tax period ends May 3, 2008 then enter "200804" in Field 01-B.

    2. Enter "2" in Field 01-P.

    The tax period is later than the current date and the return is a Final Return
    1. Change the month in the tax Period to the month prior to the current month.

    2. Enter CCC "F" in Field 01-L, if not present.

    3. Enter "2" in Field 01-P.

    The tax period is later than the current date and the return is not a Final Return
    1. Reject with Action Code "3" .

    2. Prepare Form 4227 with annotation "EARLY FILED RETURN" .

    1. It is an initial filing, research BMFOLI to see if there are previous year(s) posted for MFT 08. If posted,

    2. If no previous Form 8804 return is posted,

    1. Enter "2" in Field 01-P.

    2. SCRS will reject to have Entity input a TC 016 to change the tax period.

    It is not an initial filing and the final Form 1065 return has posted with a matching tax period. Research BMFOLR to see if there is an "F" in the alpha condition codes field. If present,
    1. Enter an "F" in Field 01-L.

    2. Enter a "2" in Field 01-P

    3. Edit Action Code "6" to the left of Section 01.

    It is not an initial filing and the final Form 1065 return has not posted with a matching tax period, Correspond with the taxpayer for clarification of the tax period with the 3653C Letter.

3.22.15.20.2.1  (01-01-2015)
Tax Period Underprint

  1. This is a 2-position field for use when the transcribed tax period month requires correction.

  2. When this field is underprinted, be sure to enter the correct FYM (01-12) to resolve the error.

    Note:

    Correspond with the taxpayer for clarification of the Fiscal Year Month (FYM) using IDRS letter 3104C when necessary.

  3. Enter Action Code "6" to the left of Section 01.

3.22.15.20.3  (01-01-2015)
Field 01-C - Name Control/Check Digits

  1. Field 01-C is a 4 position field which must be present.

  2. Valid characters are alpha (a-z), numeric (0-9, ampersand (&), hyphen (-) and blank).

    Exception:

    Alpha characters "E" "G" and "M" are not valid Check Digit characters.

  3. This field is a fixed field (no field breaker). If it is necessary to enter a name control, the number of unused spaces must be accounted for by entering the number of unused spaces in a circle immediately after the entry.

    Figure 3.22.15-2

    This image is too large to be displayed in the current screen. Please click the link to view the image.
  4. The name control is derived from the name on Line 1a.

    Note:

    Use the name control from the name on Line 2a, if Line 1a is blank.

  5. The name control of a partnership name showing multiple names is from the first 4 letters of the first partner’s last name.

    Example:

    Mary Adams and Ruth Smith Partnership
    The name control is "ADAM."

    Exception:

    The online application cannot distinguish a partner's name (first or last name) from a business (trade) name. Therefore, corporate name rules (first four characters entered in the legal name field) are applied to all partnership entities established over the internet.

  6. If the field underprints with a different name control ( not "XXXX" ):

    1. Be certain that the Name Control and EIN (Field 01-D) are entered correctly.

    2. If transcribed incorrectly, enter the correct name (or EIN). If the correct name control is different from the underprint, enter a "1" into Field 01-P (Entity Underprint Code).

    3. If the name control (and EIN) are transcribed correctly, research for a correct EIN using NAMEE and/or NAMEB. If no record, reject using AC "3" . Rejects will send it to Entity.

  7. If the name control underprints with " XXXX:"

    1. Be sure that the Name, EIN and Name Control were correctly transcribed.

    2. Research NAMEE, NAMEB and INOLE for the correct name and/or EIN or to determine how the name and name control should appear on the error register to match the Business Master File (BMF).

    3. If the EIN is in orange ink (assigned by Entity) or purple ink (assigned by Entity Unpostable), be sure it was transcribed correctly and enter a "1" into Field 01-P.

      Note:

      Also enter the Entity assignment date (located next to the EIN in orange ink) into Field 01-O, if the return is processed after the due date.

    4. If research provides a good EIN, enter it and issue Letter 3875C. Also, be sure the name control is entered correctly and input a "1" into Field 01-P.

    5. If after research you cannot determine the correct name control or a good EIN is not found, reject case using Action Code "3." Rejects will send the return to Entity.

  8. If check digits are present in Field 01-C and you change the EIN in Field 01-D, you must also change the check digits to the correct name control. Check digits are derived from the numbers of the EIN, so if the EIN is changed, the check digits are no longer valid.

  9. A check digit must have blanks in the first 2 positions and a letter other than "E" , "G" or "M" in the last 2 positions.

  10. Never re-enter check digits, even if they seem correct. When Field 01-C must be corrected, you must enter the name control.

  11. For complete information on BMF name controls, refer to Document 7071-A, BMF Name Control Job Aid.

3.22.15.20.3.1  (01-01-2015)
Name Control Underprint

  1. The Name Control Underprint is a 4 position field that is used when the transcribed name control requires correction.

  2. The following If/Then table is to be used to correct the name control underprint.

    If... Then...
    The name control is underprinted, Check Form 8804, Line 1a to see if the name was correctly transcribed, and Line 1b to see if the EIN was correctly transcribed.
    The name and EIN were correctly transcribed, Research NAMEE, NAMEB and INOLE for correct name and/or EIN.
    After research you cannot determine the correct name control, Reject case using Action Code "3" . Rejects will send to Entity.

3.22.15.20.4  (01-01-2015)
Field 01-D - Employer Identification Number (EIN)

  1. Field 01-D is a 9 position field which must be present .

  2. The valid characters are numeric 0-9.

  3. The only TIN that is valid on Fom 8804 is an EIN.

  4. The Employer Identification Number format is "NN-NNNNNNN " . The first two positions of the EIN are not invalid if it begins with these numbers; "00, 07, 08, 09, 17, 18, 19, 28, 29, 49, 78, 79, or 89."

  5. The EIN in field 01-D is located on Line 1b (or possibly on Line 2b in lieu of 1b).

    Reminder:

    Anytime you change the digits of an EIN, look at Field 01-C. If check digits are present, they must be changed to the name control. Check digits are derived from the numbers of the EIN, so if the EIN is changed, the check digits are no longer valid.

    If... And... Then...
    The EIN is missing, illegible or has more or less than 9 digits   Review any attachments for a good EIN. If none is found, research NAMEE and NAMEB.

    Note:

    If the taxpayer did not include sufficient data in line 1, then use the information on Line 2.

    A good EIN is found,  
    1. Enter EIN in Field 01-D.

    2. Send IDRS Letter 3875C.

      Reminder:

      Do not send Letter 3875C if three or less digits of the EIN are transposed, different or missing or when INOLES indicates the account has been "merged to" or "merged from"

    Note:

    If the name control is also underprinting, be sure the name control is entered correctly, and enter a "1" into Field 01-P.

    A good EIN is not found,   Reject using AC "3" . Rejects will send it to Entity.
    There is more than one EIN on the return,  
    1. Research INOLE to determine if one of the EINs is correct.

    2. Enter the correct EIN in Field 01-D.

    Both EINs are for the same partnership,   Reject using AC "3" . Rejects will send it to Entity.
    A Social Security Number (SSN), Individual Taxpayer Identification Number (ITIN) or Preparer Tax Identification Number (PTIN) is present,  
    1. Research NAMEB and NAMEE for an EIN.

    2. If and EIN is not found, Reject using AC "3" . Rejects will send the return to Entity.

    The EIN contains any of the following conditions:
    • Illegible;

    • Missing:

    • Other than 9 digits;

    • All zeroes; or

    • All nines

    Cannot be determined from attachments or schedules,
    1. Research IDRS.

    2. If EIN is found, enter in Field 01-D and on the return.

    3. Issue IDRS Letter 3875C.

      Reminder:

      Do not send Letter 3875C if three or less digits of the EIN are transposed, different or missing or when INOLES indicates the account has been "merged to" or "merged from"

    "PENDING" , "APPLIED FOR" , etc., is indicated in the EIN area,  
    1. Research IDRS.

    2. If EIN is found, enter in Field 01-D and on the return.

    3. If EIN is not found, route to Entity Control.

  6. If a return is received with no EIN and Entity has assigned an EIN, enter the Entity Assignment Date into the Correspondence Received Date field (CRD) located in the "For IRS Use Only" box on Forms 8804 and in Field 01-O.

    Caution:

    Only enter this date if the Entity Assignment date is after the Return Due Date.

3.22.15.20.5  (01-01-2015)
Field 01-E - Books and Records Checkbox - Outside the U.S. and Puerto Rico

  1. Field 01-E is a 1 position field that may be present.

  2. The valid characters are "1" and "blank."

  3. The "Books and Records" checkbox is located in the upper right corner of Form 8804, directly under the pre-printed tax year.

  4. If the checkbox is checked, it indicates that the partnership keeps it's books and records outside the United States and Puerto Rico. This changes the Return Due Date (RDD) from the 15th day of the 4th month, to the 15th day of the 6th month after the end of the partnerships tax year.

  5. If Field 01-E contains a number other than " 1," look to see if it can be a misplaced entry. Also determine if the "1" is necessary in this field by looking at the actual checkbox on Form 8804.

3.22.15.20.6  (01-01-2015)
Field 01-F - "In Care of" Name Line

  1. Field 01-F is a 35 position field that may be present. If the "In-Care-of" Name is present, then enter it in Field 01-F.

  2. The valid characters are alpha (a-z), numeric (0-9), ampersand (&), percent (%), hyphen (-) and slash (/).

    Note:

    The first character of the "in-care-of" name must be alpha or numeric.

  3. Field 01-F is invalid if any of the following conditions are present:

    • The first position is blank

    • The first character of the "in-care-of" name is not alpha or numeric

    • There are two consecutive blanks between significant characters

  4. Correct Field 01-F using the following procedures:

    If... Then...
    A blank is in the first position,
    1. Delete blank.

    2. Enter the "in-care-of" name beginning with an alpha or numeric in Field 01-F.

    The first character of the "in-care-of" name is not alpha or numeric,
    1. Verify "in-care-of" name on the return.

    2. Enter the "in-care-of" name beginning with an alpha or numeric in Field 01-F.

    Two consecutive blanks are present between significant characters, Delete any unnecessary blanks in Field 01-F.

3.22.15.20.7  (01-01-2015)
Field 01-G - Foreign Address

  1. Field 01-G is a 35 position field that may be present.

  2. Ogden Submission Processing Campus works all foreign/international addresses and U.S. Possessions/Territories returns.

    Exception:

    BMF NMF Form 8804 must be sent to Cincinnati Processing Campus.

  3. The valid characters are alpha (a-z), numeric (0-9), dash/hyphen (-), slash (/) and blank.

    Reminder:

    Training Pub 2324-002 International: Coding and Editing BMF Returns (Foreign Address Job Aid) .

  4. Field 01-G is invalid if any of the following conditions are present:

    • The first position is blank

    • Any character follows two consecutive blanks

    • There are more than 35 characters in the field

      Note:

      ISRP is instructed to input a pound sign (#) as the 35th character if there are more than 35 characters present for this field on the return. If the foreign address is longer than 35 characters, continue the address into Field 01-H.

    Figure 3.22.15-3
    This image is too large to be displayed in the current screen. Please click the link to view the image.
  5. The determination of a foreign address is based only on the address of the partnership.

    1. A foreign (international) address is any address that is not in one of the 50 states or the District of Columbia.

    2. All U.S. Possessions/Territories are considered foreign for processing purposes.

  6. A foreign address contains:

    • Street address or P.O. Box

    • City or town name

    • Other principal subdivision (i.e., province, state, county, etc.)

    • Postal code, if present can be before or after the city, town, province, state, county, etc. name but always before the foreign country

    • Foreign country

  7. See Document 7475 (State and Address Abbreviations, Major City Codes (MCCs), Countries and ZIP Codes) for the appropriate abbreviation if the address contains a state, province or territory from any of the following countries:

    • Australia

    • Brazil

    • Canada

    • Cuba

    • Italy

    • Mexico

    • The Netherlands

  8. Returns with an address in a U.S. Possessions/Territories are considered foreign returns for processing purposes and are entered in the same way as domestic addresses.

    1. A two-character alpha code must be entered in Field 01-J for the possession/territory name.

    2. A ZIP Code must be present for U.S. Possessions/Territories. See Exhibit 3.22.15-8

    U.S. Possession/Territory Abbreviation
    American Samoa AS
    Federated States of Micronesia FM
    Guam GU
    Marshall Islands MH
    Northern Mariana Islands MP
    Palau PW
    Puerto Rico PR
    Virgin Islands (U.S.) VI
  9. The U.S. Postal Service established new address requirements for APO/FPO/DPO addresses. If the old address appears (i.e., APO New York, NY 091XX), convert to the new state code abbreviation based on the ZIP Code (i.e., the previous example would be converted to APO AE 091XX). APO/FPO/DPO addresses are considered domestic addresses. Refer to conversion chart below:

    ZIP Code Address Country APO/FPO Address
    34000-34049 APO Americas APO AA [ZIP Code]
    34050-34099 FPO Americas FPO AA [ZIP Code]
    340XX-340XX DPO Americas DPO AA [ZIP Code]
    090XX-094XX
    096XX-098XX
    APO Europe APO AE [ZIP Code]
    095XX FPO Europe FPO AE [ZIP Code]
    090XX-098XX DPO Europe DPO AE [ZIP Code]
    962XX-965XX
    98700-98759
    APO Pacific APO AP [ZIP Code]
    966XX and
    98760-98799
    FPO Pacific FPO AP [ZIP Code]
    962XX-966XX DPO Pacific DPO AP [ZIP Code]

3.22.15.20.8  (01-01-2015)
Field 01-H - Address

  1. Field 01-H is a 35 position field that must be present .

  2. The valid characters are alpha a-z, numeric 0-9, dash/hyphen (-), slash (/) and blank.

  3. Field 01-H is invalid if any of the following conditions are present:

    • Any character is present other than alpha, numeric, blank, dash or slash

    • The first position is blank

    • Any character follows two consecutive blanks

    • There are more than 35 characters present in the field.

    Note:

    ISRP is instructed to input a pound sign (#) as the 35th character if there are more than 35 characters present for this field on the return.

  4. When entering either the mailing address or location address information, remember the following guidelines:

    1. Ensure that a house or building number is present.

    2. Always input the suite, apartment number, room number, etc. at the end of the street address line.

    3. If present, always input the street suffix, such as street, drive, lane, terrace, etc... (See Document 7475).

    4. If present, always include the direction information, such as North, South, East, West, etc.

    5. If the name of a street is also a direction and a direction is present, abbreviate the direction only and not the name of the street.

      Example:

      1836 West South Street would be entered as 1836 W South St.

  5. Enter Action Code "6" to the left of Section 01, when correcting the address.

    If... Then...
    Address is more than 35 characters Abbreviate the address if necessary.
    The first position is blank All positions must be blank.
    Street address is in error and a valid Major City Code is present Correct by entering the entire name of the city in Field 01-I (i) and the State Code in Field 01-J. (See Document 7475)
    If no street address or P.O. Box is provided Enter the word "Local" on the street address line.

    Note:

    This should occur in very small towns only.

3.22.15.20.9  (01-01-2015)
Field 01-I (i) - City

  1. Field 01-I is a 22 position field that must be present.

  2. When a foreign address is present, enter the foreign country code in Field 01-I. See Document 7475, Section 6 for a list of valid foreign country codes.

  3. Valid characters are alpha and blank.

  4. Field 01-I is invalid if any of the following conditions are present:

    • The first position is blank

    • Any position contains other than a blank or alpha

    • Any character follows two consecutive blanks

    • The Major City Code does not match any of the valid codes in the Major City Code Table

      Note:

      Certain cities within each state are designated Major Cities and are assigned a special code of two alpha characters. ISRP enters the Major City Code as appropriate. This code represents the city and state and is transcribed on the error record with no intervening blanks and no other characters in the City field either before or after the code.

    • Foreign country code is not valid or Field 01-I contains "XX"

    If... Then...
    A Major City Code is used Field 01-I must be present.
    Field 01-I contains an error Check to see if the Major city code is correct.
    Field 01-I is not valid and a Major City Code cannot be determined Enter the entire city name in Field 01-I.
    A Major City Code is not used and Field 01-I is present Field 01-J (state) must be present.
    A foreign address is shown on the return Enter the appropriate foreign country code in Field 01-I (See Document 7475, Section 5).
    Field 01-I contains an incorrect country code or "XX " Enter the appropriate foreign country code in Field 01-I (See Document 7475, Section 5).

3.22.15.20.10  (01-01-2015)
Field 01-J - State

  1. Field 01-J is a 2 position field that must be present.

  2. The valid characters are:

    • Alpha (a-z) and must be on the list of valid state codes

    • Period ("." ) followed by a Blank space for foreign addresses

    Caution:

    This field can never be completely blank.

  3. If the address is one of the U.S. states or a U.S. Possession, enter the valid state code from the list of valid state codes. See Document 7475.

    Note:

    Since there is no state code for a foreign country, enter a period (.) and a blank (which is a "1" in a circle – to indicate a blank space) into the first position of Field 01-J to take the place of the state code.

    Figure 3.22.15-4
    This image is too large to be displayed in the current screen. Please click the link to view the image.

3.22.15.20.11  (01-01-2015)
Field 01-K - ZIP Code

  1. This is a 12 position field that must be present for all U.S. and U.S. possession addresses. It must not be present for other foreign addresses.

  2. The valid characters are numeric (0-9).

  3. A minimum of five (5) digits must be entered when required, but up to 12 digits can be entered.

  4. Invalid conditions are:

    • Field 01-K is blank and there is an entry in Field 01-J

    • Field 01-K is present and a period is present in Field 01-J

    • The zip code in Field 01-K does not agree with the state code in Field 01-J.

  5. The only ZIP Codes that can be entered in Field 01-K are for U.S. states and U.S. Possessions/Territories.

  6. Postal codes from any foreign country can not appear in Field 01-K. Postal codes are part of the foreign address. See IRM 3.22.15.20.7.

    If... Then...
    The address is a U.S. address and Field 01-K is missing, or incomplete
    1. Research the ZIP Code Directory.

    2. Enter the correct zip code in Field 01-K.

    The ZIP Code is for a U.S. Possession/Territory and there is a period in Field 01-J
    1. Delete the period from Field 01-J.

    2. Enter the appropriate state code abbreviation for the possession/territory in Field 01-K. ( See Document 7475)

    3. Delete the name of the U.S. Possession/Territory if present in another field.

    Field 01-K is present and there's a period in Field 01-J
    1. Review the return to determine if there is a foreign address.

    If a foreign address is present on the return
    1. Delete entry from Field 01-K.

    2. Delete city from Field 01-I, if present, and enter the appropriate country code. See Document 7475, Section 5.

    A foreign address is not present on the return
    1. Delete the period from Field 01-J.

    2. Enter the appropriate state code in Field 01-J. See Document 7475.

    Figure 3.22.15-5
    This image is too large to be displayed in the current screen. Please click the link to view the image.
  7. The only foreign zip code that can be entered into the zip code field is the Zip code of a U.S. possession. No Postal Code from any other foreign country can appear in the zip code field.

  8. Foreign "ZIP" codes (called Postal Codes) cannot be present in this field, but should appear as part of Field 01-H (if space is available).

  9. See Document 7475, which also contains a list of ZIP codes.

  10. Depending on the addressing conventions of a foreign country, a foreign Postal code can be entered at the end of the address line or be included as part of the foreign address.

  11. If there is a period and space in the state code field, then the entry in the Zip code field will be invalid. If the Zip code is that of a U.S. possession, then change the state code entry to the state code for the possession and delete the possession name if it appears in another field. If the Zip code is that of a foreign country, blank the Zip code field and enter the Zip code into the address field.

3.22.15.20.12  (01-01-2015)
Field 01-L - Computer Condition Code

  1. Field 01-L is a 10 position field that may be present.

  2. The valid characters are: "A" , "D" , "E" , "F" , "G" , "O" , "Q" , "R" , "S" , "V" , "W" , "X" , "Y" , "3" , "4" , and "7" .

  3. The CCC is entered onto the return on the "CC" line in the "For IRS Use Only" box in the upper, right corner of the return, under the EIN box.

  4. Leave "blank" if no CCC is required.

    CCC Description
    A Schedule A (Form 8804) is attached but no penalty was computed.
    D Partnership provided reasonable cause for waiver of the failure to pay penalty.
    E Credit elect or penalty payment is to be applied.
    F Partnership indicates that they will not file this return in the future (final return). Filing requirement for the return is removed.
    G Amended, corrected or superseding return. If there is any question that the return is an amended return, research BMFOLT (MFT 08) for a TC 150 present in the module for the tax period. If there is a TC 150, it is an amended return. If a TC 150 is not present, process the return as an original.

    Reminder:

    If you enter CCC "G" for an amended return, you must delete the following: Section 02, Fields 01-E, 01-F, 01-G, 01-H, 01-I, 01-J, and 01-K. In Field 01-L, only CCC "G" (and "W" if needed) can be present.

    O A pre-settlement manual refund was issued.
    Q Manual computation of the tax was completed due to a math error on the return.
    R Indicates a delinquent return with reasonable cause. The failure to file penalty is not assessed.
    S An overpayment (refund) appears on Form 8804 and the taxpayer does not specify application of the overpayment to the subsequent period.
    V Reasonable cause to waive the Daily Delinquency penalty. The daily penalty will not be assessed.
    W Return cleared by Statute Control Unit.

    Reminder:

    If the tax period is prior to 200412, then Form 8804 must be re-numbered and processed to NMF. Do not send it to Statute Control for clearance.

    X Generates a TC 570 to freeze the tax module. Used when doing credit transfers, etc. or may be necessary in certain "No Reply" conditions. Will not allow the refund to be issued.
    Y Accepts a return as filed (e.g. short period return)
    3 Indicates that there was a No Reply to correspondence.

    Caution:

    CCC 3 cannot be present if there is an entry in Field 01-O (Correspondence Received Date). Determine the correct entry and delete the other.

    4 Indicates the return was prepared by the IRS under IRC § Section 6020(b).
    7 Reasonable cause for failure to file timely was considered and denied.

    Caution:

    When using CCC "7" , do not use CCC "D" or "R" .

3.22.15.20.13  (01-01-2015)
Field 01-M - Received Date

  1. Field 01-M is an 8 position field that must be present.

  2. The received date may be stamped onto the middle of the return or may be entered on the "RD" line in the "For IRS Use Only" box in the upper, right corner of the return.

  3. The Return Due Date (RDD) for Form 8804 is the 15th day of the 4th month after the end of the partnerships tax year (April 15 for YYYY13). The RDD is the 15th day of the 6th month after the end of the partnership’s tax year (June 15 YYYY13) if Field 01-E has a "1" (books and records kept out of the U.S. and Puerto Rico).

  4. Valid conditions for Field 01-M are:

    • Must be in YYYYMMDD format

    • Must be all numeric (0-9)

  5. Field 01-M is invalid when any of the following conditions are present:

    • Field is blank or contains less than 8 digits

    • It is not in the proper YYYYMMDD format

    • It is a future date

    • Field is prior to the tax period

    • The month is not 01-12, or the day is not 01-31, depending upon the month

    Month Day
    01, 03, 05, 07, 08, 09, 10 and 12 01-31
    04, 06, 09 and 11 01-30
    02 01–28 (29 in leap year)

    Note:

    Sometimes, especially in the beginning of the year, the date will show the correct day and month, but the previous year, due to a stamping error in Numbering. Change it to the current year (look at the signature date, attachments, postmark date etc. to help determine the correct year).

  6. Correct coding and transcription errors.

    If... Then...
    The received date is not stamped or edited on the return Determine the received date in the following priority and enter the date on the second line of the "For IRS Use Only " and in Field 01-M:
    1. Latest postmark date on an attached envelope Service Center Automated Processing System (SCAMPS) digital dates.

    2. Revenue Officer's signature date.

    3. Return signature date (if current year).

    4. Julian date minus 10 days.

    5. Current date minus 10 days.

    Field 01-E is invalid because the month in the received date is the same as the month in the tax period, Enter the first day of the month following the month in the tax period in Field 01-M.
    There are multiple received dates and one of the received dates is from another IRS office, Enter the earliest received date stamped in Field 01-M.
    There are multiple received dates and both dates are stamped by the same IRS office, Enter the latest received date stamped in Field 01-M.
    The return has both a U.S. Postal or foreign postmark and a private meter mark, Enter the U.S. Postal Service or foreign postmark in Field 01-M.
  7. The received date is changed to the legal due date of the return if the postmark shows legal timely mailing, without regard to the grace period.

  8. DO NOT change the received date on a return if:

    • No envelope is attached

    • No postmark is indicated on a return bearing a delinquent Received Date

  9. Process a return as a timely-filed return when:

    • It is necessary to use the signature date or the DLN control date to ascertain timeliness

    • The computation results in a timely Received Date

  10. Use the following chart to select and enter the Received Date for returns addressed to IRS:

    IRS Received Date Official US Postmark Received
    On or Before Due date N/A Use IRS Received Date
    After Return Due Date (RDD) On or Before RDD Use U.S. Postmark Date
    After Return Due Date After RDD Use IRS Received Date
    After Return Due Date Period Missing/Illegible Use IRS Received Date
    Missing/Illegible Present Use U.S. Postmark Date
    Missing/Illegible Missing/Illegible Use Signature Date, or DLN Julian Date minus 10-days
  11. If the postmark is not legible, the taxpayer has the burden of proving the date when the postmark was made. Refer to Treasury Regulation Section 301.7502-1(c)(1)(iii).

    Reminder:

    If the legal due date falls on a Saturday, Sunday, or holiday, the return is considered to be timely if it is postmarked by the first work day thereafter. The Service allows an extended due date from the legal due date, which includes Saturdays, Sundays and legal holidays. A return received after the extended due date is considered delinquent if the postmark date is after the extended due date.

  12. If the legal due date falls on a Saturday, Sunday, or holiday, the return is considered to be timely if it is postmarked by the first work day thereafter. A return received after the return or extended due date is delinquent.

  13. Take the following action when processing returns that were sent back to the taxpayer:

    • Timely Replies: If the return and the reply to correspondence is received by the return due date, consider the return timely.

    • Late Replies: If the return and the reply to correspondence is received after the return due date, circle all previous received dates, and determine a new received date using the following priorities. The IRS date stamp stamped by the receipt and control function, the postmark date on the reply envelope, the SCAMPS date, or the current date.

    • Incomplete Replies: If the return was originally timely submitted but incomplete and a valid (complete) return is filed within the period requested on the IRS correspondence returning the original submission, consider the return timely filed.

3.22.15.20.13.1  (01-01-2015)
Statute of Limitations

  1. A period of limitation is a time period established by law to review, analyze and resolve taxpayer and/or IRS related issues.

  2. The Internal Revenue Code (IRC) states that the Internal Revenue Service (IRS) will assess, refund credit, and collect taxes within specific time limits. These limits are known as Periods of Limitations. When they expire, we can no longer assess additional tax, allow a claim for refund by the taxpayer, nor take collection action. There are different periods of limitations for Assessment, Refund, and Collection Statutes. The expiration of these periods is tracked separately.

  3. The different periods of limitations expiration dates that are tracked are:

    • Assessment Statute Expiration Date (ASED): Return filed early - 3 years from the later of (1) the date the Form 8804 is filed or (2) April 15th if the Form 8804 is filed before April 15th of the calendar year following the calendar year that the tax was incurred. See IRM 4.31.2.2.17.2.1. No return filed - assessment may occur at anytime. IRC § 6501(a) , IRC IRC § 6501(b)(2), IRC IRC §6501(3)(c), andIRC IRC § 6229(c)(3)

    • Refund Statute Expiration Date (RSED): 3 years from the time the return was filed or, if later, 2 years from the date after the tax was paid. IRC § 6511(a) and (b)(2)(A).

    • Collection Statute Expiration Date (CSED) is generally 10 years from the 23-C date or 10 years from the date of the TC 29X or 30X adjustment. IRC § 6502(a).

    Note:

    Exceptions may apply to change the periods of limitations.

  4. There are several conditions that may change the general Assessment Statute Expiration Date (ASED). They include:

    • IRC § 6501 (c) (1) - False Return

    • IRC § 6501 (c) (4) - Extensions by Agreement

    • IRC § 6501 (b) (3) - Substitute for Return by Authority of IRC § 6020(b)

      Caution:

      IRC § 6020(b) is not a tax return that triggers the period of limitations on assessment under IRC § 6501(a). If the taxpayer subsequently files a return reporting an additional liability, that return constitutes an original tax return allowing for the assessment of any additional amount not already assessed under the Substitute for Return program and triggering the running of the period of limitations on assessment for the tax year.

    • IRC § 6501 (d) - Is request for Prompt Assessments, which shortens the Assessment Period

    • IRC § 6501 (e) - Substantial (in excess of 25%) Omission of Income provides for a 6 year period of limitations.

    • IRC § 6503 (a) - Issuance of Statutory Notice of Deficiency (90-day Letter, which suspends the running of the period of limitations.)

    • IRC § 6901 (c) - Fiduciaries and Transferees

    • IRC § 6503 (h) - Bankruptcy

    • IRC § 6229 (a) through (h) - Partnership Items

3.22.15.20.13.2  (01-01-2015)
♦Protective Claims♦

  1. Returns marked as "Protective Claim," "Protective Refund," "Protective Claim for Refund," or similar statement will be removed from the batch and routed to Accounts Management if unnumbered. Notate "Protective Claim" in the remarks box of Form 4227.

    Exception:

    If the return is amended, do not remove from batch. Enter Computer Condition Code "G" in Field 01-L and use Action Code "6."

3.22.15.20.14  (01-01-2015)
Field 01-O - Correspondence Received Date

  1. Field 01-O is a 8 position field (YYYYMMDD) that may be present.

  2. The valid characters are numeric (0-9) or blank.

  3. This field is invalid if any of the following is present:

    • Not in YYYYMMDD format.

    • The entry is the same as the Received Date in Field 01-M

    • The entry is earlier than the Received Date in Field 01-M

    • The entry is earlier than the return due date (including the grace period)

  4. The correspondence received date is to be entered on the "CR" line in the "For IRS Use Only" box in the upper, right corner of the return.

  5. This date must be later than both the Due Date (15th day of the 4th month after the tax year or the 15th day of the 6th month after the tax year if the books are kept outside the U.S.) of the return and the received date.

    Note:

    An entry of "1" in Field 01-E adds 2 months to the usual due date, which, in turn, affects the validity of the correspondence received date.

  6. This field cannot be used when CCC "3" is present in Field 01-L, even if the date in Field 01-O is the Entity assignment Date and there was no reply to correspondence.

  7. The CRD date should be stamped onto the reply, which is attached to the return. If not, look for and use the postmark date on the attached envelope. If the taxpayer faxed the reply, use the date the fax was received.

  8. This field can also contain the date that Entity assigned an EIN to the return (the Entity Assignment Date). This date is subject to the same restrictions as the correspondence received date, as the computer cannot differentiate between them.

    Note:

    If you have both a correspondence received date and an Entity Assignment Date, enter the later date into the field.

  9. If Field 01-O is invalid,

    1. Review the attached correspondence to determine the reply received date.

    2. If the received date (Field 01-M) is prior to the due date of the return, delete entry in Field 01-O (this includes a date entered by Entity when a TIN was assigned).

    3. If there was no reply, delete any date in Field 01-O, and enter CCC 3 in Field 01-L.

  10. Do not enter a date in Field 01-O if:

    • The taxpayer is not at fault

    • The correspondence is due to IRS error

3.22.15.20.15  (01-01-2015)
Field 01-P - Entity Underprint Code (EUC)

  1. Field 01-P is a 1 position field used by error correction tax examiners when correcting the tax period Fiscal Year Month (FYM), or other entity data.

  2. This field does not appear on the return, only the error register.

  3. Enter "1" if:

    1. The name control underprints a different name control and the corrected name control is not the same as the underprint.

      Note:

      This is especially true if the name control itself is not corrected but the EIN is. You still need the Entity Underprint Code (EUC) "1" to clear the underprinted name control if the EIN is now correct.

    2. The name control underprints "XXXX" and the name control and EIN are both correct as is, or you correct either or both fields.

      Note:

      If the EIN is in orange (assigned by Entity) or purple (assigned by Entity Unpostables), the "1" is still required.

    3. As long as the underprinted name control is different from the name control in the field, the record continues to loop until the EUC is entered.

  4. Enter "2" if:

    1. The month underprinting the tax period (Field 01-B) does not agree with the month of the tax period in the field. If the correct tax period month does not agree with the underprint, the 2 must be entered into Field 01-P.

    2. If the tax period ending month on INOLE does not agree with what the taxpayer shows as the ending month at the top of the return, a TC 016 will be required. SCRS will reject and Rejects will send the return to Entity. Upon return, an EUC of 2 will be required to clear the underprint.

  5. Enter "3" if:

    1. When both the name control and the tax period underprint and the correct name control and tax period-ending month do not agree with their respective underprints.

    2. If both fields underprint and a "1" or "2" is entered instead of a "3," the record continues to loop (e.g. 2 will not clear the tax period underprint if the "3" is required).

  6. If there is no different underprint for either the name control or tax period, do NOT enter an EUC. If the name control is invalid (*) rather than underprinting, do not enter an EUC. The field must underprint and the correct data must not match the underprint for an EUC to be required.

  7. If the field is invalid, look at the name control and the tax period fields to determine if an EUC is required. If it is, enter the correct code; if not, blank the field.

3.22.15.20.16  (01-01-2015)
Field 01-Q - Taxpayer Notice Codes (TPNC)

  1. Field 01-Q is a 6 position field that may be present.

  2. The valid characters are 01, 02, 03, 90, or blank.

  3. The taxpayer notice codes are not entered into this field by the tax examiner. The TPNC is entered into the upper, left corner of the return and on the return to the left of Section 01, with Action Code "1" .

  4. The purpose of this field is to store the TPNCs after the return goes to good tape (posts). Only the computer can enter the TPNCs into this field.

  5. If the field is invalid because of an invalid TPNC or other entry, do not correct the field. Just make whatever other correction is required, such as assigning the correct (or same) TPNC (to the left of Section 01).

  6. You may see the TPNCs in this field if the TPNC were assigned on RAW and the record Loops, showing the "AA" (invalid correction attempt) on the top line of the error register record. In this case, the TPNCs will not be invalid. If there are no other errors, use Action Code "7" to clear the record.

  7. Do not enter a TPNC when any of the following is present:

    • Difference in Balance Due/Overpayment (+/-) ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    • Total Section 1446 tax ≡ ≡ ≡ ≡ ≡ ≡ ≡

    • The withholding credit ≡ ≡ ≡ ≡ ≡ ≡ ≡ for each type of Form (e.g. Form 1042-S, Form 8805).

      Note:

      There is no tolerance for Form 8288-A credits, all Form 8288-A credits must be verified by the Code and Edit Foreign Investment in Real Property Tax Act (FIRPTA) examiners created within the Code and Edit Unit of the OSPC or the Austin Submission Processing Campus (AUSPC).

  8. Remember, never enter or correct data in Field 01-Q.

  9. If correspondence is required, use IDRS Letter 3104C.

  10. The narratives below are printed on the BMF notice for the appropriate TPNC entered in Field 01-Q. TPNC 01 and 02 will print on CP 131A (Math Error, Balance Due of $1 to $4.99 on Form 990C, Form 990T, Form 1041, Form 1120 , and TPNC 03 will print on CP 173 (Notification of Estimated Tax Penalty Due on Form 1120 Series, Form 1041, Form 990-C, Form 990-T and Form 990-PF.

    Reminder:

    Before using any TPNC, check to make sure that all math has been verified.

    TPNC Literal
    01 We found an error in the total Section 1446 tax.
    02 We cannot allow the amount of tax withheld shown on Form 8804 because you didn't attach any supporting documentation. Therefore, we changed your return. If we are in error, please provide us with the necessary documentation to support the amount of withholding taxes claimed on your return. This documentation can be a copy of either Form 8805, Form 8288-A, or Form 1042-S.

    Note:

    It is not uncommon for taxpayers to enter the credit amount on the wrong line. Before you send TPNC 02, you must research BMFOLT (MFT 08) for the tax period and look to see if the credit amount posted (either all of it or part of it). This will appear as TC 660, TC 670, TC 716, TC 610, etc. If you see this, adjust the form accordingly before you use TPNC 02.

    03 We found that the installment tax payments (Payments with Extension of time to file and overpayments applied from last year's taxes) shown on your account do not agree with the amount claimed on your return.

    Note:

    This TPNC would usually be used only in the Rejects unit if notified by Unpostables that there was such an error. It could, of course, be used by SCRS or Rejects if research was done that showed the amounts did not agree.

    90 An open paragraph for notices of errors not covered by the previous TPNCs.

    Example:

    Deletion of a non-substantiated credit amount and no reply to correspondence was received. Or,
    Failure to attach the required election statement to apply the IRC § 1446 Regulations to the 2005 tax return. Or,
    Error in total credits on Line 7.

3.22.15.20.17  (01-01-2015)
Field 01-R - Preparer PTIN

  1. Field 01-R is a 9 position field that may be present.

  2. Valid conditions are:

    • Entry is blank

    • "P" for the first character followed by eight numeric characters

  3. Invalid condition is one of the following:

    • Field 01-R is other than a "P" followed by eight digits

    • Contains all zeroes

    • Contains all nines

    • Contains all numeric

  4. Correct Field 01-R as follows:

    If... Then...
    Only a valid PTIN is present Enter the PTIN in Field 01-R, and use AC "6."
    Only a valid SSN is present Delete the SSN in Field 01-R, and use AC "6."
    A valid PTIN is present and a SSN is also present Enter the PTIN in Field 01-R. Use AC "6."
    A valid PTIN cannot be located Delete the entry in Field 01-R, and use AC "6."

3.22.15.20.18  (01-01-2015)
Field 01-S - Preparer EIN

  1. Field 01-S is an 9 position field that may be present.

  2. Valid conditions are:

    • Entry is blank

    • All numeric

  3. Invalid condition is one of the following:

    • Field 01-S is other than nine numeric digits

    • Contains all zeroes

    • Contains all nines

  4. Correct Field 01-S as follows:

    If... Then...
    Only a valid EIN is present Enter the EIN in Field 01-S. and use AC "6" .
    A valid PTIN is present and an EIN is also present Enter the PTIN in Field 01-R, and delete the entry in Field 01-S. Use AC "6" .
    Both an EIN and SSN are present Delete the SSN in Field 01-R, and make sure the EIN in Field 01-S is correct. Use AC "6" .
    A valid EIN cannot be located Delete the entry in Field 01-S, and use AC "6" .

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